ERC Clawback Amended Return 2026 Calculator
The Employee Retention Credit clawback calculator estimates IRS exposure for 2020/2021 ERC claims under the Voluntary Disclosure Program (VDP) versus disallowance audits. Compare withdrawal vs full repayment plus 20% accuracy penalty plus interest, with the 5-year statute of limitations now extending audit windows to April 2027 (2020 Q3-Q4) and April 2028 (2021 Q1-Q3).
| Total ERC claimed | — |
| VDP repayment (85%) | — |
| Disallowance repayment (100%) | — |
| 20% accuracy penalty | — |
| Interest accrual (est.) | — |
| Worst-case audit exposure | — |
| VDP savings vs disallowance | — |
The ERC clawback calculator estimates IRS audit exposure for Employee Retention Credit claims filed for 2020 and 2021 quarters. The IRS extended the statute of limitations to 5 years (vs the normal 3-year limit) under the SECURE Act 2.0, pushing audit deadlines to April 15, 2027 for 2020 Q3-Q4 claims and April 15, 2028 for 2021 Q1-Q3 claims. The Voluntary Disclosure Program (VDP) under IRS Notice 2024-30 lets businesses repay 85% of received ERC with no penalty.
Withdrawal Program vs Disallowance Audit
If your 941-X is still pending, the ERC Withdrawal Program lets you cancel the claim with zero cost — no repayment, no penalty, no interest. If the refund was already received, the Second VDP (closed Nov 2024) allowed repaying 85% with no penalty. Without VDP, a disallowance audit forces 100% repayment plus a 20% accuracy-related penalty under IRC §6662 plus underpayment interest from the original refund date (currently 8% annual).
5-Year SOL Extension (Critical 2026 Risk)
The IRS extended the assessment statute of limitations for ERC claims to 5 years under the Infrastructure Investment and Jobs Act. For 2020 Q3-Q4 claims, the IRS has until April 15, 2027 to assess deficiencies. For 2021 Q1-Q3 claims, the deadline extends to April 15, 2028. Most fraudulent or aggressive claims will receive audit notices in 2026-2027. Document retention is mandatory — keep payroll records, government shutdown orders, and gross receipts comparisons for at least 6 years.
Common Disqualifying Mistakes
(1) No actual government order — supply chain disruption alone does NOT qualify unless a specific government order suspended your supplier. (2) Recovery Startup misuse — only businesses started after Feb 15, 2020 with under $1M gross receipts qualify, max $50K/quarter. (3) Aggregation rules ignored — controlled groups must be combined for the 100/500 employee threshold. (4) Owner wages claimed — wages paid to majority owners (>50% direct or constructive ownership) and their family members are EXCLUDED. (5) PPP double-dip — wages used for PPP forgiveness cannot also be claimed for ERC. Sources: IRS ERC Resource Center, IRS Notice 2024-30, IRC §3134.
Last updated May 2026. Educational only — consult a CPA before filing 941-X amendments.